Gold forecast..............
"December Gold -- O 296.7 H 297.3 L 296.1 C 296.4 Chg. -.70
In a pitifully weak $1.20 range, it was business as usual in this range-bound market. In pre-holiday trade, rollovers into deferred months are taking place and this is probably weighing a bit on prices. Yesterday, European Finance Ministers approved a gold Euro collector coin to be issued simultaneously with the new currency in 2002. Is this news a bullish surprise to the market...probably not. It also now seems that, according to last weeks Commitments of Traders report, that large funds are now net long gold, a reversal from just a week or so ago. On the surface this may seem exceedingly bullish, but if the big players are already long, who is left to buy? In any case, we are in a technical market, and technical indicators are still heading higher. Bulls shouldn't hop on board and jump in with futures until this market proves its strength. A close over 305.5 would look promising for a run to 320-325. The longer-run chart pattern still looks good for a leg higher, as there is an inverted head and shoulders that began in May, which targets as high as 325. Choppy conditions persist and gold could still easily stab higher to the mid 320 area. However, I don't expect a raging bull market, and I would only buy futures on strength. Consider February calls if you wish to relax while looking for a $20-30 bounce. " |
